The UK Government has launched a consultation on a series of proposed reforms to the collective action regime in the Competition Appeal Tribunal (CAT), with the aim of making group litigation more efficient, accessible and cost-effective.
The proposals seek to simplify the existing opt-out collective action process while maintaining appropriate safeguards for claimants, defendants and litigation funders. According to the consultation, the reforms are intended to improve the overall operation of the regime without expanding its scope beyond competition law.
One of the key proposals would require the Competition Appeal Tribunal to assess the reasonableness of litigation funders’ returns at the certification stage of a claim. This is intended to help ensure that collective actions deliver meaningful benefits to claimants while discouraging cases where legal costs or funding arrangements may outweigh the compensation available.
The Government is also consulting on changes that would allow litigation funders to receive approved returns earlier in the claims process, rather than waiting until damages have been distributed. Officials believe this could improve the efficiency and sustainability of collective proceedings while providing greater certainty for those financing complex litigation.
In addition, the consultation explores whether restrictions on the use of damages-based agreements (DBAs) in collective proceedings should be relaxed. Expanding funding options could increase competition within the litigation funding market and improve access to justice for claimants pursuing complex competition claims.
Other proposals include measures to encourage earlier settlement discussions, introduce stronger cost consequences for parties that act unreasonably during proceedings, and consider introducing court fees linked to the value of claims filed before the Competition Appeal Tribunal.
The Government has confirmed that it is not proposing to extend the current opt-out collective action regime beyond competition law at this stage, instead focusing on improving the effectiveness of the existing framework.
The consultation is open until 25 September 2026, after which the Government will review responses before deciding whether legislative or procedural changes should be introduced.
These proposals form part of the Government’s ongoing review of collective proceedings and reflect continued efforts to improve access to justice while ensuring that the UK’s competition litigation framework remains fair, proportionate and effective.
